The accompanying unaudited interim condensed
consolidated financial statements and related notes have been prepared in accordance with accounting principles generally accepted
in the United States of America (“U.S. GAAP”) for interim financial information, and in accordance with the rules and
regulations of the United States Securities and Exchange Commission (the “SEC”) with respect to Form 10-Q and Article
10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete
financial statements. The unaudited interim condensed consolidated financial statements furnished reflect all adjustments (consisting
of normal recurring adjustments) which are, in the opinion of management, necessary for a fair statement of the results for the
interim periods presented. Interim results are not necessarily indicative of the results for the full year. These unaudited interim
condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and
notes thereto contained in the Company’s annual report on Form 10-K for the year ended December 31, 2017.

Use of Estimates

The preparation of the consolidated finance
statements in conformity with accounting principles generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the condensed consolidated
Financial Statements and the reported amounts of revenues and expenses during the reporting period. Such management estimates include
allowance for doubtful accounts, estimates of product returns, warranty expense, inventory valuation, valuation allowances of deferred
taxes, stock-based compensation expenses and fair value of warrants and derivatives. The Company bases its estimates on historical
experience and on assumptions that it believes are reasonable. The Company assesses these estimates on a regular basis; however,
actual results could materially differ from those estimates.

Concentration of Risk Related to
Third-party Suppliers

We depend on a limited number of third-party
suppliers for the materials and components required to manufacture our products. A delay or interruption by our suppliers may harm
our business, results of operations, and financial condition, and could also adversely affect our future profit margins. In addition,
the lead time needed to establish a relationship with a new supplier can be lengthy, and we may experience delays in meeting demand
in the event we must change or add new suppliers. Our dependence on our suppliers exposes us to numerous risks, including but not
limited to the following: our suppliers may cease or reduce production or deliveries, raise prices, or renegotiate terms; we may
be unable to locate a suitable replacement supplier on acceptable terms or on a timely basis, or at all; and delays caused by supply
issues may harm our reputation, frustrate our customers, and cause them to turn to our competitors for future needs.

Fair Value of Financial Instruments

The Company recognizes and discloses the
fair value of its assets and liabilities using a hierarchy that prioritizes the inputs to valuation techniques used to measure
fair value. The hierarchy gives the highest priority to valuations based upon unadjusted quoted prices in active markets for identical
assets or liabilities (Level 1 measurements) and the lowest priority to valuations based upon unobservable inputs that are significant
to the valuation (Level 3 measurements). Each level of input has different levels of subjectivity and difficulty involved in determining
fair value.

Level 1

Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the measurable date.

Level 2

Inputs, other than quoted prices included in Level 1, that are observable for the asset or liability through corroboration with market data at the measurement date.

Level 3

Unobservable inputs that reflect management’s best estimate of what participants would use in pricing the asset or liability at the measurement date.

The carrying amounts of the Company’s
financial assets and liabilities, including cash, accounts receivable, accounts payable, and accrued liabilities approximate fair
value because of the short maturity of these instruments. The carrying value of the Company’s loan payable and convertible
notes payable approximates fair value based upon borrowing rates currently available to the Company for loans with similar terms.

Business Segments

ASC 280 defines operating segments as components
of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision
maker in deciding how to allocate resources and in assessing performances. Currently, ASC 280 has no effect on the Company’s
condensed consolidated financial statements as substantially all of the Company’s operations are conducted in one industry
segment.

Cash

The Company considers all highly liquid
investments with original maturities of three months or less to be cash equivalents. As of September 30, 2018 and December 31,
2017, the Company held no cash equivalents.

The Company’s policy is to place
its cash with high credit quality financial instruments and institutions and limit the amounts invested with any one financial
institution or in any type of instrument. Deposits held with banks may exceed the amount of insurance provided on such deposits.
The Company has not experienced any losses on its deposits of cash.

Accounts Receivable and Allowance
for Doubtful Accounts

Accounts receivable are recorded at the
invoiced amount and are not interest bearing. The Company maintains an allowance for doubtful accounts for estimated losses resulting
from the inability of its customers to make required payments. The Company makes ongoing assumptions relating to the collectability
of its accounts receivable in its calculation of the allowance for doubtful accounts. In determining the amount of the allowance,
the Company makes judgments about the creditworthiness of customers based on ongoing credit evaluations and assesses current economic
trends affecting its customers that might impact the level of credit losses in the future and result in different rates of bad
debts than previously seen. The Company also considers its historical level of credit losses. As of September 30, 2018 and December
31, 2017, there was an allowance for doubtful accounts of $27,851 and $27,851 respectively.

During the nine months ended September
30, 2018 the Company recorded a bad debt expense of $0.

Inventory

Inventory is stated at the lower of cost
or market value. Inventory is determined to be salable based on demand forecast within a specific time horizon, generally eighteen
months or less. Inventory in excess of salable amounts and inventory which is considered obsolete based upon changes in existing
technology is written off. At the point of recognition, a new lower cost basis for that inventory is established and subsequent
changes in facts and circumstances do not result in the restoration or increase in that new cost basis.

Property and Equipment

Property and equipment are recorded at
cost, less accumulated depreciation and amortization. Depreciation and amortization are provided using the straight-line method
over the useful life as follows:

Internal-use software

3 years

Equipment

3 to 5 years

Computer equipment

3 to 7 years

Furniture and fixtures

5 to 7 years

Leasehold improvements

Shorter of life of asset or lease

Accounting for Website Development
Costs

The Company capitalizes certain external
and internal costs, including internal payroll costs, incurred in connection with the development of its website. These costs are
capitalized beginning when the Company has entered the application development stage and cease when the project is substantially
complete and is ready for its intended use. The website development costs are amortized using the straight-line method over the
estimated useful life of three years.

Impairment of Long-Lived Assets

Long-lived assets, such as property and
equipment, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of such assets
may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset
to future undiscounted net cash flows expected to be generated by the asset. If the carrying amount of an asset exceeds its estimated
future cash flows, an impairment charge is recognized in the amount by which the carrying amount of the asset exceeds the fair
value of the asset. Assets to be disposed of would be separately presented in the balance sheets and reported at the lower of the
carrying amount or fair value less costs to sell, and no longer depreciated. The assets and liabilities of a disposed group classified
as held for sale would be presented separately in the appropriate asset and liability sections of the balance sheets.

Debt Discount and Debt Issuance Costs

Debt discounts and debt issuance costs
incurred in connection with the issuance of debt are capitalized and amortized to interest expense based on the related debt agreements
using the straight-line method. Unamortized discounts are netted against long-term debt.

Derivative Liability

In accordance with Financial Accounting
Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Paragraph 815-15-25-1 the conversion
feature and certain other features are considered embedded derivative instruments, such as a conversion reset provision, a penalty
provision and redemption option, which are to be recorded at their fair value as its fair value can be separated from the convertible
note and its conversion is independent of the underlying note value. The Company records the resulting discount on debt related
to the conversion features at initial transaction and amortizes the discount using the effective interest rate method over the
life of the debt instruments. The conversion liability is then marked to market each reporting period with the resulting gains
or losses shown in the statements of operations.

In circumstances where the embedded conversion
option in a convertible instrument is required to be bifurcated and there are also other embedded derivative instruments in the
convertible instrument that are required to be bifurcated, the bifurcated derivative instruments are accounted for as a single,
compound derivative instrument.

The Company follows ASC Section 815-40-15
(“Section 815-40-15”) to determine whether an instrument (or an embedded feature) is indexed to the Company’s
own stock. Section 815-40-15 provides that an entity should use a two-step approach to evaluate whether an equity-linked financial
instrument (or embedded feature) is indexed to its own stock, including evaluating the instrument’s contingent exercise and
settlement provisions. The adoption of Section 815-40-15 has affected the accounting for (i) certain freestanding warrants that
contain exercise price adjustment features and (ii) convertible bonds issued by foreign subsidiaries with a strike price denominated
in a foreign currency.

The Company evaluates its convertible debt,
options, warrants or other contracts, if any, to determine if those contracts or embedded components of those contracts qualify
as derivatives to be separately accounted for in accordance with paragraph 810-10-05-4 and Section 815-40-25 of the FASB Accounting
Standards Codification. The result of this accounting treatment is that the fair value of the embedded derivative is marked-to-market
each balance sheet date and recorded as either an asset or a liability. In the event that the fair value is recorded as a liability,
the change in fair value is recorded in the consolidated statement of operations as other income or expense. Upon conversion, exercise
or cancellation of a derivative instrument, the instrument is marked to fair value at the date of conversion, exercise or cancellation
and then that the related fair value is reclassified to equity.

The Company utilizes the binomial option
pricing model to compute the fair value of the derivative and to mark to market the fair value of the derivative at each balance
sheet date. The binomial option pricing model includes subjective input assumptions that can materially affect the fair value estimates.
The expected volatility is estimated based on the most recent historical period of time equal to the remaining contractual term
of the instrument granted.

Revenue Recognition

The Company adopted
ASC 606 effective January 1, 2018 using the modified retrospective method which would require a cumulative effect adjustment for
initially applying the new revenue standard as an adjustment to the opening balance of retained earnings and the comparative information
would not require to be restated and continue to be reported under the accounting standards in effect for those periods.

Based on the Company’s
analysis the Company did not identify a cumulative effect adjustment for initially applying the new revenue standards. The Company
principally generates revenue through providing product, services and licensing revenue

The adoption of ASC
606 represents a change in accounting principle that will more closely align revenue recognition with the delivery of the Company’s
services and will provide financial statement readers with enhanced disclosures. In accordance with ASC 606, revenue is recognized
when a customer obtains control of promised services. The amount of revenue recognized reflects the consideration to which the
Company expects to be entitled to receive in exchange for these services. To achieve this core principle, the Company applies the
following five steps:

1)

Identify the contract with a customer

A contract with a customer exists when
(i) the Company enters into an enforceable contract with a customer that defines each party’s rights regarding the services
to be transferred and identifies the payment terms related to these services, (ii) the contract has commercial substance and, (iii)
the Company determines that collection of substantially all consideration for services that are transferred is probable based on
the customer’s intent and ability to pay the promised consideration. The Company applies judgment in determining the customer’s
ability and intention to pay, which is based on a variety of factors including the customer’s historical payment experience
or, in the case of a new customer, published credit and financial information pertaining to the customer.

2)

Identify the performance obligations in the contract

Performance obligations promised in a contract
are identified based on the services that will be transferred to the customer that are both capable of being distinct, whereby
the customer can benefit from the service either on its own or together with other resources that are readily available from third
parties or from the Company, and are distinct in the context of the contract, whereby the transfer of the services is separately
identifiable from other promises in the contract. To the extent a contract includes multiple promised services, the Company must
apply judgment to determine whether promised services are capable of being distinct and distinct in the context of the contract.
If these criteria are not met the promised services are accounted for as a combined performance obligation.

3)

Determine the transaction price

The transaction price is determined based
on the consideration to which the Company will be entitled in exchange for transferring services to the customer. To the extent
the transaction price includes variable consideration, the Company estimates the amount of variable consideration that should be
included in the transaction price utilizing either the expected value method or the most likely amount method depending on the
nature of the variable consideration. Variable consideration is included in the transaction price if, in the Company’s judgment,
it is probable that a significant future reversal of cumulative revenue under the contract will not occur. None of the Company’s
contracts as of September 30, 2018 contained a significant financing component. Determining the transaction price requires significant
judgment, which is discussed by revenue category in further detail below.

4)

Allocate the transaction price to performance obligations in the contract

If the contract contains a single performance
obligation, the entire transaction price is allocated to the single performance obligation. However, if a series of distinct services
that are substantially the same qualifies as a single performance obligation in a contract with variable consideration, the Company
must determine if the variable consideration is attributable to the entire contract or to a specific part of the contract. For
example, a bonus or penalty may be associated with one or more, but not all, distinct services promised in a series of distinct
services that forms part of a single performance obligation. Contracts that contain multiple performance obligations require an
allocation of the transaction price to each performance obligation based on a relative standalone selling price basis unless the
transaction price is variable and meets the criteria to be allocated entirely to a performance obligation or to a distinct service
that forms part of a single performance obligation. The Company determines standalone selling price based on the price at which
the performance obligation is sold separately. If the standalone selling price is not observable through past transactions, the
Company estimates the standalone selling price taking into account available information such as market conditions and internally
approved pricing guidelines related to the performance obligations.

5)

Recognize revenue when or as the Company satisfies a performance obligation

The Company satisfies performance obligations
either over time or at a point in time. Revenue is recognized at the time the related performance obligation is satisfied by transferring
a promised service to a customer.

Product revenue

Revenue from multiple-element arrangements
is allocated among separate elements based on their estimated sales prices, provided the elements have value on a stand-alone basis.

Licensing revenue

Some of the Company’s revenues are
generated from software-as-a-service (“SaaS”) subscription offerings and related product support and maintenance.
SaaS revenues stem mainly from annual subscriptions and are recorded evenly over the term of the subscription. Any customer payments
received in advance are deferred until they are earned. Consulting and training revenues are recognized as work is performed.

Product Returns

For any product in its original, undamaged
and unmarked condition, with its included accessories and packaging along with the original receipt (or gift receipt) within 30
days of the date the customer receives the product, the Company will exchange it or offer a refund based upon the original payment
method.

Customer Deposits

The Company accounts for funds received
from crowdfunding campaigns and pre-sales as a liability on the consolidated balance sheets as the investments made entitle the
investor to apply these funds towards future shipments once the product has been developed and available for commercial use.

Research and Development Costs

Research and development costs are charged
to expense as incurred. These costs consist primarily of salaries and direct payroll-related costs. It also includes purchased
materials and services provided by independent contractors, software developed by other companies and incorporated into or used
in the development of our final products. Research and development expenses for the nine months ended September 30, 2018 and 2017
were $283,869 and $87,602, respectively.

Advertising Costs

Advertising costs are charged to sales
and marketing expenses and general and administrative expenses as incurred. Advertising expenses, which are recorded in sales and
marketing and general and administrative expenses, totaled $130,475 and $741,813 for the nine months ended September 30, 2018 and
2017, respectively.

Stock-Based Compensation

The Company accounts for stock-based compensation
in accordance with ASC Topic 718, “Compensation – Stock Compensation” (“ASC 718”) which establishes
financial accounting and reporting standards for stock-based employee compensation. It defines a fair value based method of accounting
for an employee stock option or similar equity instrument. Accordingly, stock-based compensation is recognized in the consolidated
statements of operations as an operating expense over the requisite service period. The Company uses the Black-Scholes option pricing
model adjusted for the estimated forfeiture rate for the respective grant to determine the estimated fair value of stock-based
compensation arrangements on the date of grant and expenses this value ratably over the requisite service period of the stock option.
The Black-Scholes option pricing model requires the input of highly subjective assumptions. Because the Company’s stock options
have characteristics significantly different from those of traded options, and because changes in the subjective input assumptions
can materially affect the fair value estimate, in management’s opinion, the existing models may not provide a reliable single
measure of the fair value of the Company’s stock options. In addition, management will continue to assess the assumptions
and methodologies used to calculate estimated fair value of stock-based compensation. Circumstances may change and additional data
may become available over time, which could result in changes to these assumptions and methodologies for future grants, and which
could materially impact the Company’s fair value determination.

The Company accounts for share-based payments
to non-employees in accordance with ASC 505-50 “Equity Based Payments to Non-Employees”. If the equity instrument
is a stock option, the Company uses the Black-Scholes option pricing model to determine the fair value. Assumptions used to value
the equity instruments are consistent with equity instruments issued to employees as the terms of the awards are similar. The Company
recognizes the fair value of the equity instruments as expense over the term of the service agreement and revalues that fair value
at each reporting period over the vesting periods of the equity instruments.

Warranty

The Company provides a limited warranty
for its analyzers and sensors for a period of 1 year from the date of shipment that such goods will be free from material defects
in material and workmanship. The Company has assessed the historical claims and, to date, warranty claims have not been significant.
The Company will continue to assess the need to record a warranty accrual at the time of sale going forward.

Collaborative Arrangements

The Company and its collaborative partners
are active participants in the collaborative arrangements and both parties are exposed to significant risks and rewards depending
on the commercial success of the activity. The Company records all expenses related to collaborative arrangements as research and
development expense in the consolidated statements of operations as incurred.

Earnings per Share

Basic net loss per common share is
computed by dividing net loss attributable to common stockholders by the weighted-average number of common shares outstanding during
the period. Diluted net loss per common share is determined using the weighted-average number of common shares outstanding during
the period, adjusted for the dilutive effect of common stock equivalents. In periods when losses are reported, which is the case
for the nine months ended September 30, 2018 and 2017 presented in these condescend consolidated financial statements, the weighted-average
number of common shares outstanding excludes common stock equivalents because their inclusion would be anti-dilutive.

The Company had the following common stock
equivalents at September 30, 2018 and 2017:

September 30, 2018

September 30,
2017

Series A Preferred stock

51

51

Series B Preferred stock

1,906,270,000

3,000,000,000

Convertible notes payable

140,209,819

26,462,823

Convertible accounts payable

300,000,000

273,860,683

Options

1,496,250

1,490,026

Warrants

1,267,454,215

260,345,149

Totals

3,615,430,335

3,562,158,732

There
were approximately 3,615,430,335 potentially outstanding dilutive common shares for the period ended September 30, 2018.
Since the Company incurred a net loss for the period ended September 30, 2018, the inclusion of any common stock equivalents
would have been anti-dilutive.

Recent Accounting Guidance Adopted

In April 2016, the FASB issued ASU No.
2016-10, “Revenue from Contracts with Customers: Identifying Performance Obligations and Licensing” (topic 606).
In March 2016, the FASB issued ASU No. 2016-08, “Revenue from Contracts with Customers: Principal versus Agent Considerations
(Reporting Revenue Gross versus Net)” (topic 606). These amendments provide additional clarification and implementation
guidance on the previously issued ASU 2014-09, “Revenue from Contracts with Customers”. The amendments in ASU 2016-10
provide clarifying guidance on materiality of performance obligations; evaluating distinct performance obligations; treatment of
shipping and handling costs; and determining whether an entity’s promise to grant a license provides a customer with either
a right to use an entity’s intellectual property or a right to access an entity’s intellectual property. The amendments
in ASU 2016-08 clarify how an entity should identify the specified good or service for the principal versus agent evaluation and
how it should apply the control principle to certain types of arrangements. The adoption of ASU 2016-10 and ASU 2016-08 is to coincide
with an entity’s adoption of ASU 2014-09, which we adopted for interim and annual reporting periods beginning after December
15, 2017. The adoption of ASU 2016-10 had no material effect on its financial position or results of operations or cash flows.

In May 2016, the FASB issued ASU No. 2016-12,
“Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients”, which narrowly
amended the revenue recognition guidance regarding collectability, noncash consideration, presentation of sales tax and transition
and is effective during the same period as ASU 2014-09. The adoption of ASU 2016-12 had no material effect on its financial position
or results of operations or cash flows.

Management does not believe that any recently
issued, but not yet effective accounting pronouncements, when adopted, will have a material effect on the accompanying condensed
consolidated financial statements.